All about Adoption Leave Pay

There are some startling facts surrounding adoption in the UK. According to the government, there were 69,470 children in care (also known as ‘looked-after children’) in 2015. Five years later in 2020, there were 80,080.

Even more staggering is that the number of children being adopted in these years went down. In 2015, 5,360 were adopted, yet in 2020 the figure was only 3,440. One thing that is often a barrier to adoption is being able to look after the child and continue with work. Thankfully, the UK government has recognised this worry and created adoption leave.

What is adoption leave?

In the United Kingdom, anyone in work is entitled to adoption leave from their first day of employment. Statutory Adoption Leave lasts for a maximum of 52 weeks, just like maternity leave. There are some criteria that you are required to meet in order to be eligible for adoption leave.

You must:

• Be classed as an employee.
• Inform your employer and provide the correct amount of notice.
• Provide proof of the adoption (or fostering to adopt) if you’re asked for it.
• Have been matched with the child or children through an official adoption agency – private adoptions or relative adoptions do not count.

As soon as a person is matched with a child, they have seven days to inform their employer of the following:

• How much adoption leave they want to take (up to 52 weeks).
• The adoption leave start date.
• The date the child is coming to live with you – Also called the ‘date of placement’.

Employers have 28 days to confirm the adoption leave start and end dates.

You do not need to show proof of adoption to be entitled to Statutory Adoption Leave unless your employer requests this.

What is adoption leave pay?

Like maternity pay, Statutory Adoption Pay is paid for 39 weeks and it starts when you take the adoption leave. For the first six weeks of adoption leave, you are entitled to 90% of your weekly earnings (or average weekly earnings if the amount fluctuates).

 For the next 33 weeks, you get (whichever is the lower amount):

• 90% of your weekly earnings (or average weekly earnings); or
• £156.66 per week.

Who is entitled to adoption leave pay?

Not everyone is entitled to Statutory Adoption Pay.

In order to qualify for this, you must:

• Earn a minimum of £123 per week (before tax) for a minimum of 8 weeks before the date you are matched with the child.
• Inform your employer with the correct notice period.
• Provide proof of the adoption.
• Be classed as an employee.
• Have been working continuously for the employer for a minimum of 26 weeks (before the ‘qualifying week’ in surrogacy and at the match date for adoption).

Agency workers could still be eligible for adoption leave pay too.

Those who find themselves ineligible might still qualify for adoption leave but it would be unpaid.

The qualifying week as referenced above is important as this determines when you need to give your employer notice to be entitled to adoption leave and Statutory Adoption Pay. The qualifying week is 15 weeks before a surrogate baby is due to be born.

Proving the adoption

Unlike adoption leave, everyone who requests adoption leave pay must provide proof of the adoption.

This proof must show:

• The person’s name and address.
• The adoption agency’s name and address.
• The match date.
• The placement date.
• An ‘official notification’ proving you are allowed to adopt (if you are adopting from overseas).
• The date the child arrived in the United Kingdom (if you are adopting from overseas).

Adoption leave pay and having a child through surrogacy

People who are having a baby through surrogacy might be eligible for both Statutory Adoption Leave and Statutory Adoption Pay. This is, however, the legal minimum. Some employers have better adoption leave and adoption pay schemes, much like maternity leave schemes.

To be eligible for this, the same rules apply as with Statutory Adoption Leave. You will need to be classed as an employee, must inform the employer with the correct notice period and also give proof of the surrogacy if you are asked for it. The pay received is the same as Statutory Adoption Pay.

Adopting as a couple

If you’re a couple that’s adopting, only one person can get adoption leave and Statutory Adoption Pay. It is up to the individual couple to decide which person will take this. The partner who doesn’t take the adoption leave might still be able to get paternity leave and paternity pay. It’s also possible to use Shared Parental Leave and receive the pay for this.

How much is adoption leave pay?

Statutory Adoption Pay is paid for 39 weeks (unless the person decides to go back to work sooner).

The amount paid is as follows:

• 6 weeks at 90% of your average weekly earnings.
• 33 weeks at £156.66 per week or 90% of your average weekly earnings, whichever amount is lower.

You can be on adoption leave for up to 52 weeks but the final 13 weeks are without pay.

Deductions from adoption leave pay

Adoption leave pay is still taxable and employees will receive deductions for tax and National Insurance just like normal. It’s important to note, however, that the standard personal tax allowance is £12,570, which means that people will only pay tax on anything they earn above this amount. This might mean, therefore, that some people won’t pay tax on their adoption leave pay.

As for National Insurance, you pay Class 1 National Insurance contributions if you earn above £242 per week and this is at 12%. Once you’ve passed the initial six weeks of adoption leave pay, it will not be deducted.

Student loans are similar and depend upon the type of loan taken and when it was taken out. Like National Insurance contributions or tax, you will not be earning enough after the initial six weeks for payments to be deducted.

Depending on earnings, some people won’t pay tax, National Insurance contributions or student loans on the initial six weeks of adoption leave pay either.

Keeping in Touch (KIT) days

During adoption leave, parents can take up to ten paid ‘Keeping in Touch’ (KIT) days. These allow employees to go into work to complete training or occasional work without losing their Statutory Adoption Pay or ending their leave.

As soon as you go over your ten allowed days, you lose a week’s Statutory Adoption Pay for every week or part-week worked.

Who pays for adoption leave?

It is the employer’s responsibility to pay for adoption leave. If the company ceases trading when someone is on adoption leave, they must still pay the adoption leave pay. Employers can get financial help to pay Statutory Adoption Pay.

Employers can usually reclaim 92% of payments and it’s also possible to apply for an advance if they cannot afford the payments. They can apply for this through HMRC up to four weeks before the first payment is due.

Small employers can recover 100% of adoption leave pay and can also receive a further 3% compensation.

If an employer becomes insolvent during a person’s adoption leave, HMRC will pay the adoption leave pay on the employer’s behalf.

How long is adoption leave paid?

Although adoption leave can be up to 52 weeks long, only the first 39 weeks are paid. If an employee wishes to remain on adoption leave after the 39th week then this is unpaid. They can, however, choose to work up to ten KIT days, for which they can be paid.

Adoption leave pay and maternity/paternity leave pay

Statutory Adoption Leave and Statutory Adoption Pay have been almost the same since April 2015. Like maternity and paternity pay, the employee must have worked for their employer continuously for 26 weeks.

Shared parental leave and adoption leave

As with maternity leave, those on adoption leave have the right to Shared Parental Leave. This means that the person on adoption leave can transfer this to their partner.

To be eligible for this, the person who the leave is transferring to must:

• Be the mother or father of the child.
• Be the partner/husband/wife of the mother/father.
• Have a minimum of 26 weeks’ service.
• Earn above £123 a week.
• Be taking the time off to care for the child.
• Have at least two weeks of the adoption leave period remaining.

Your rights during adoption leave

When on adoption leave, a person’s employment continues and, apart from the salary, all of the benefits and rights continue.

Annual leave and holidays

By law, employees have a right to 28 days’ annual leave each year (this is pro-rata if you’re part time). When on adoption leave, you continue to accrue paid holidays just like when you’re at work. Many people choose to take these before their adoption leave starts or at the end when they’re due back at work.

If the annual leave isn’t taken, the employer has to carry this over until the next year because you’re entitled to 52 weeks’ adoption leave and you can’t take annual leave at the same time.

If you choose not to return to work, you should be paid in lieu of the annual leave you accrued but didn’t take.

Pay rises

If you are awarded a pay rise while you are taking adoption leave, the adoption pay won’t be recalculated. The only exception to this is if the pay rise is back-dated and would have been paid in the ‘relevant period’ – i.e., the week in which you were matched with the child. This will affect the six weeks at 90% of your salary and will be recalculated to reflect the higher pay.

Other benefits

If you have things like a company mobile phone, a company car, club membership, luncheon vouchers, health insurance, or other benefits, these should continue during your adoption leave. Things like subsidised childcare, free/subsidised travel, professional subscriptions and share schemes should all continue.

Pension contributions

During the first 26 weeks of adoption leave (referred to as ‘OAL’ or ordinary adoption leave), the employer has to pay your full pension contributions as if you were at work, even if you plan not to return to work after your adoption leave ends. The contributions have to be based on your normal pay.

If your scheme includes you paying contributions, then these will be based on the money you receive as Statutory Adoption Pay.

You are also entitled to employer pension contributions for some of the additional adoption leave (that is the last 26 weeks of your adoption leave entitlement). When adoption pay ends (week 40 onwards) so does the entitlement to employer pension contributions.

Other benefits adoptive parents could be entitled to

Adopting a child comes with additional challenges and there is financial support available to some adoptive parents.

Here are some things you could be entitled to:

Adoption Support Fund

The Adoption Support Fund is available to regional adoption agencies and local authorities to help pay for therapeutic services for eligible families. This can fund services to help the adopted child improve engagement with learning or improve relationships with teachers, family and friends.

Children who have suffered bereavement, substance misuse or those who have mental health problems might need specific therapy.

This is available to children who live in England and are up to (and including) age 21. If the child has an Education Health and Care Plan (EHCP) or Statement of Special Educational Needs, this is available until they are 25.

Adoption Allowance

This is a payment that a local authority might pay in order to find an adoptive home for a child who might be difficult to adopt. This means the adoptive parents receive a regular allowance or regular lump sums under specific circumstances. This could be for a child with a disability or additional needs that requires extra support or one that has behavioural difficulties.

The amounts offered vary and they also take into account the family’s financial resources.

Other financial help

In addition to the Adoption Support Fund and Adoption Allowance, there is other funding that can help children thrive in new placements. Some of this financial help is discretionary and is paid directly to parents but other financial help is given to schools to help them assist the adopted child reach their potential.

Examples of financial help include:

• Settling-in grants – This might help adoptive parents to pay for large items like car seats or beds. It is discretionary and a social worker will tell you how to apply for this.
• Discretionary housing payments – You might be able to receive this when you’re waiting for the child to be placed in your home.
• Pupil Premium – This is a sum of money paid directly to the school.

Final thoughts

Adoption leave pay can be tricky to get your head around. If there’s anything you’re unsure of or you think your employer isn’t doing things correctly, you should speak to Citizens Advice.